Trade unionists this week unanimously condemned "parasitic" payroll companies that strip workers of rights by unfairly classifying them as self-employed.

Trade unionists this week unanimously condemned "parasitic" payroll companies that strip workers of rights by unfairly classifying them as self-employed.

Construction union UCATT warned the Trades Union Congress that "increasingly employers and employment agencies are attempting to flout laws on employment status by forcing workers to be paid via a payroll company.

"Workers are then forced on to a contract of self-employment and denied even the most basic employment rights."

Earlier this year we went undercover
as company bosses and caught some of Britain's biggest payroll companies red-handed when they told us they would be prepared to make "our" workers self-employed even when they should, by rights, be employees.

A UCATT spokesman said: "Payroll companies force workers to sign contracts, which certify that they are self-employed.

"This results in them being denied even the most basic employment rights such as holiday pay, sick pay and redundancy pay. As workers are officially self-employed they can be dismissed without warning.

"By forcing workers to operate via payroll companies the true employer is able to avoid paying employers national insurance contributions of 13.8 per cent per worker. A massive hidden subsidy costing the Exchequer hundreds of millions of pounds every year.

"In a perverse twist it is the workers themselves who pay for the payroll company. They pay directly from their wages for the cost of the payroll company's operations. Charges can either be a percentage of a workers earnings or a flat rate weekly fee of between £15 -£25."

George Guy, Acting General Secretary of UCATT, told the TUC Congress: "Payroll companies have absolutely nothing to do with construction. They put nothing into the industry yet they make a tidy living from those working within it. They are what you would call parasites."

"At a time when the Government is imposing massive cuts in public spending it seems inconceivable that the money being lost to the Treasury in this manner goes unchallenged."

The motion was backed by the British Airline Pilots' Association, which said the disturbing trend should be a concern of every passenger and taxpayer.

BALPA General Secretary Jim McAuslan said, 'Like many trade unions we are concerned about workers who to all intents and purposes are employees but are being forced to register as self-employed.

"This gets the company out of having to provide holiday pay, redundancy cover, sick pay and leaves individuals fearing that they could be laid off at any moment."

He pointed to a recent Supreme Court ruling
and urged unions to use the judgment to launch a major attack on the abuse by employers of self-employment status.

By passing the motion this week, the TUC Congress has committed the TUC General Council to "campaign actively for a change in the law to prevent payroll companies being able to classify workers as self-employed."